Ann writes a put option to John, which allows John to sell 1 BTC for 30,000 USDC (strike price). Ann's and John's USDC collaterals are locked in the vault. John acquired the option by buying it on Spin through the Order Book.Scenario 1: Let’s say the price of BTC goes down to 25,000 USDC on the contract's expiration date. That means John’s option is now in the money and Spin will automatically exercise the option at the price of 5,000 USDC (expiration price is the strike price). But actually John earns profit gradually. As option price is going up before expiration, John's unrealized PnL also increases. After the expiration date John will be able to withdraw all his blocked collateral, plus the realized profit from his vault.Scenario 2: Let's say the price of BTC goes up to 35,000 USDC, so the option's execution price is zero, meaning no funds are transferred from John to Ann and vice versa.
Suppose that, Ann sold a put option to John for 1,000 USDC. As the underlying asset's price changes, both John and Ann will have some unrealized PnL, so Ann's maximum PnL will be 1,000 USDC after the settlement of the contract. And John's maximum PnL is 30,000 USDC (if BTC price goes to 0) minus 1,000 USDC premium price.